Money laundering and terrorist financing is a serious global issue. The International Monetary Fund estimates that the amount of money laundering occurring on a yearly basis could range between 2 and 5 per cent of the world's gross domestic product, or somewhere between $600 billion and $1.5 trillion. As an international business centre that hosts more than 1,500 financial institutions, Singapore is vulnerable to cross-border financial crimes. Furthermore, with rapid advancements in information technology offering greater speed, ease of use and anonymity, perpetrators now have more possibilities than ever before to launder illegal proceeds through global remittances, mobile money and virtual currencies. In view of this, the Wealth Management Institute (WMI) has developed a programme on anti-money laundering (AML) risk management. The programme is sponsored by UBS for a period of three years and aims to deepen AML competencies in the wealth management industry to fight financial crime.
Under the programme, WMI will create technology-enhanced learning modules on AML and the countering of financial terrorism (CFT). The programme will be accredited by the Institute of Banking & Finance and will take into account issues faced by the wealth management industry. It will also commission research papers relating to AML and CFT. The modules will be made available to industry participants such as private bankers, compliance and audit professionals and there will also be forums available for senior compliance decision-makers. One of the key objectives of the AML programme is to share global best practices and facilitate local adoption and adaptation of proven approaches.
Besides utilising WMI's extensive network of wealth management practitioners, the institute is tapping into a panel of AML experts to provide strategic input into the AML programme. The Expert Panel members include Jonathan Shih, Head of Compliance and Operational Risk Control and Global Head of Financial Crime, UBS; David James, Her Majesty's Revenue and Customs' Fiscal Crime Liaison Officer; Ian Wong, deputy director of the Commercial Affairs Department, Jon Page, Head of Business Consulting, Asia Pacific at BAE Systems Applied Intelligence; and Larry Lam, managing director at McGuire Asia and Lem Chin Kok, Head of Forensic at KPMG Singapore.
Money laundering is the generic term used to describe the process by which criminals disguise the original ownership and control of the proceeds of criminal conduct by making such proceeds appear to have derived from a legitimate source. Though criminal money may be successfully laundered without the assistance of the financial sector, the reality is that hundreds of billions of dollars of criminally derived money is laundered through financial institutions, annually. The nature of the services and products offered by the financial services industry (namely, managing, controlling and possessing money and property belonging to others) means that it is vulnerable to abuse by money launderers.
According to the United Nations Office on Drugs and Crime (UNODC), less than 1% of global illicit financial flows are currently seized by authorities.